Only One Third of Bitcoin Supply is Vulnerable to Quantum Threat: Research ⋆ ZyCrypto

Prefer Us On Google

A recent whitepaper by Ark Invest and the crypto financial services company Uchained argues that more than two-thirds of the total BTC supply is already safe from quantum attacks. The looming threat is back in the discussion among crypto users and development circles due to the rapid growth of the quantum sector and its perceived ability to overwhelm BTC’s SHA-256 algorithm.

However, the extensive research piece by ARK Invest and Unchained proves that a lion’s share of the entire supply (65%) is already quantum-proof, and there is ample time left to upgrade the system to secure the remaining amount (34.6%) from the next generation of computing.

Breaking Down the Quantum Threat

The paper identifies five stages of quantum impact:

Currently, the quantum threat remains between Stages 0 and 1, indicating it is too early to cause mass panic in the digital currency economy. The shift to quantum computing will involve multiple intermediate warning levels and inflection points, giving developers plenty of time to deploy the necessary updates.

The paper also breaks down Bitcoin’s supply and its vulnerability to incoming quantum computing threats:

These groupsets include:

• Early P2PK (Pay-to-Public-Key) Addresses (8.6%) of the total supply, where the public key is visible. They are the most vulnerable. 
• Address Reuse (~5M BTC): This is another vulnerable area, but it can be addressed over time. This is when an address sends and receives BTC; the public key becomes visible. 
• P2TR (Taproot) Addresses (~200k BTC): The whitepaper shows that the current taproot implementation, in which the address is migratable, can be exploited. 
• Secure Supply (65.4%): Most modern Bitcoin addresses (P2PKH, P2SH, and P2WPKH) only reveal a hash of the public key. A quantum computer, despite its overwhelming advantages, cannot retrieve a public key from its hash. 

The pie chart shows that the majority of the supply is either already safe from quantum threats or can be safeguarded with the necessary upgrades. The issue of P2PK-era BTC is a more challenging part of the puzzle that will require further deliberation among developers. 

The Future

Although quantum computing poses no imminent threat to a significant portion of the BTC supply, the network needs to adopt quantum-safe protocols to boost user confidence and ensure long-term viability. 

A new upgrade, BIP 3160, is already under discussion to quantum-proof the network, but it is likely only a temporary fix in the grand scheme of things.